News From Telecom World

Huawei has announced that it recently has signed a Global Master Agreement with Telenor Group to supply Mobile Broadband Modems.

Under the agreement, Huawei will involve to deliver 1.2 million Mobile Broadband Modems in the coming 12 months for Telenor’s 13 operating companies in Europe, CIS and Asia, including Norway, Sweden, Denmark, Hungary, Serbia, Montenegro, Russia, Ukraine, Pakistan, Bangladesh, Thailand and Malaysia.

According to the report from consulting firm ABI Research, Huawei secured a substantial 55% of the global mobile broadband terminal market. By the end of February 2009, Huawei had shipped over 30 million mobile broadband units, serving 235 operators in 115 countries and providing them with customization solutions that match subscriber requirements.

Source: Huawei website

I don’t often write about tech issues, but so much is being written about the Google Chrome OS announcement I thought I’d weigh in.

On the surface, the announcement of a Google operating system seems to many like a shot at rival Microsoft, an attack at MS’s core business. But those who have been following Google’s moves know that it’s more than that — it’s an (expected) evolution in Google’s long-term strategy.

Google is moving everything online, and I really believe this is the future of computing. The desktop model of computing — the Microsoft era — is coming to an end. It’ll take a few years, but it will happen.

The Old Model
For years, the OS has used the desktop analogy, with folders and files, all stored in a big file cabinet (your hard drive). And applications such as Word have run from the hard drive.

What this has meant is that, in order to insure against computer crashes (which are eventually inevitable), you’ve had to back up your files to a remote disk (another drive, a CD-ROM, etc.). It also has meant a headache when it comes to accessing your files and programs from multiple computers — you have to save and sync files all the time, and buy and install multiple copies of applications.

It’s also meant a lot of headaches when it comes to filing and finding your files, and sharing them with other people (this had to be done using floppy disks/CDs, or more recently, email attachments).

Finally, operating systems, trying to do everything, have become bloated and slow, taking up a lot of your computer’s processing power, memory and storage.

The New Model
Google’s model is based on connectivity to the Internet, a model that was unthinkable a decade ago and has only been really viable in the last few years as almost everyone has high-speed connections and wi-fi or mobile access.

Google has moved applications, and increasingly, our files, to the web (or cloud). It started with Gmail’s success — a fast, powerful online email app that beats desktop email apps hands down. It expanded with a suite of simple web apps: Google Calendar, Docs & Spreadsheets, Google Reader, Picasa for photos, eventually YouTube for video, Blogger for writing for the web, and more.

These apps are lightweight but powerful. They aren’t as feature rich as desktop apps, but here’s what many critics don’t understand: in today’s (and tomorrow’s) computing world, they don’t have to be.

While the business world has long used Microsoft Word to create rich documents full of formatting and charts, the increasingly mobile world doesn’t care about any of that. We send emails and text messages and tweets and messages on Facebook and forums and other social media — with no formatting at all. We do blog posts that have bold and italics and links and photos and videos and not much more in terms of formatting text.

We don’t need feature-bloated Microsoft Word anymore. Nor Excel, with its 2 million features, nor PowerPoint (who likes to watch slides?). Sure, there are still some great desktop apps that people use, for photo and video editing and much more … but the majority of us don’t need those. We need to communicate simply and quickly, without hassle.

Web apps don’t match up with desktop apps … but that’s a good thing for most of us who use the new computing model.

Web apps are lightweight and fast. They store all your files online, so you don’t need to worry about syncing them or carrying around CDs or flash drives, or backing up. You can share with anyone you like, or everyone, with a click.

This is what the computing world is becoming, and will be for many years. Google has driven these changes, and when it announced the Chrome browser last year, that was an obvious move to make the browser handle web apps better.

The Chrome OS is an obvious move to make computers bypass the old model of desktop apps and files and folders, and go straight to the web, web apps, and online files. Chrome OS will be lightweight and fast (like the Chrome browser), it will feature web apps and not much else, and it will be perfectly aligned with how more and more of us are using the web — with mobility, speed, sharing, and connecting in mind.

Why Google Music is the Next Logical Step
If you read the Google Chrome OS announcement carefully, you’ll see an interesting item:

“[People] want their data to be accessible to them wherever they are and not have to worry about losing their computer or forgetting to back up files.”

This obviously means Google OS will store all its files online — then people don’t need to worry about backing up the files, and if they lose their computer, nothing will really be lost.

And that makes sense, considering that Google has moved almost all your files online if you use its web apps: emails, photos (in Picasa), videos (in YouTube), documents (Google Docs & Spreadsheets), even pdfs now.

Almost all of your files.

The average user has one other type of file, though: mp3s. Sure, I know there are many other types of files, but I’m only concerned with what most people use computers for these days — email, online reading and social stuff, video, photos, music. And Google has not moved music online yet.

There are already sites that do this, but they’re not Google. So either Google will buy one of the online sites (like it did with YouTube and Blogger and Writely, which became Google Docs), or it will create its own.

Your mp3s will be stored online, and you’ll be able to play them from anywhere. This will complete Google’s goal of keeping all your files online.

Concerns: Connectivity and Privacy
There are two main concerns that people have when cloud computing or web apps are brought up, so we should talk about them briefly:

1. What if you’re not connected to the cloud? You might lose your Internet connection and lose access to your files. This is not a concern for most of us, as we’re almost always connected, more and more each year, especially with data plans on mobile devices (ala the iPhone). However, Google is already addressing this issue with Google Gears and HTML5 — you’ll be able to access your files and use web apps even when offline.

2. Do I really want Google to have all my files and info? This is a valid privacy concern, and I don’t have an answer. My personal feeling is that I don’t have any data that I’m incredibly worried about losing or that might become public. I highly doubt Google would be interested in browsing through my files, as they’re not very interesting. And if Google uses my data to serve up better ads … what do I care? I don’t look at their ads anyway.

However, I understand the privacy concern. It may turn out to be an important issue, or it might just be something we learn to live with, as we have with many other privacy issues (government having access to our financial data, Microsoft getting info from our computers, etc.).

Update: More info on Chrome.

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The toolkit launches in a couple of days, and until then there’s a pre-sale that drops the price from $67 to $49 (32% off).

Source: zenhabits

The implementation of a direct operator top-up strategy can bring double digit revenue gains and reduced costs, claims a study commissioned by electronic payments vendor, Vesta Corp. Given the size of the prepaid market in Western Europe, this can equate to hundreds of millions of Euros annually, adds the report. Direct operator top-up channels include all operator-managed top-up channels that rely on electronic transactions outside a retail environment, such as the operator’s website, IVR and handset applications.

The research indicates the significant advantages that direct operator prepaid top-up has over other existing top-up methods, including improved performance metrics, lower costs and improved CRM capabilities. In addition, direct handset top-up has the ability to remove the fragmentation and complexity impacting the take up of m-payment services and drive new revenue streams for operators.

The research has been conducted by independent telecom consultancy Northstream and is based on the feedback of wireless operators across Western Europe.

Chris Parsons, CMO of Vesta commented, “When prepaid direct top-up is executed properly it not only offers an opportunity to increase the ARPU of prepaid but also provides the foundation for operators to seamlessly offer a wide range of profitable mobile payment services from the same platform. Aside from prepaid debit reload, other services such as peer-to-peer transfer, international remittance and mobile commerce become far more readily accessible.”

According to the whitepaper, with overall growth in the prepaid market slowing, operators are looking at ways to reduce costs while increasing prepaid customer loyalty and revenues. Non-cash (credit/ debit card/ bank) payment penetration has grown significantly in Europe, and a staggering 91% of operators interviewed intend to drive top-up transactions from costly commission-based retail infrastructures to “virtual” non-cash top-up (NCTU) channels.

Aligned with this view, not only are operators exploring alternatives to retail top-up but 100% of those interviewed want to shift their non-cash payment mechanisms from a bank centric model to a direct operator model. Given this finding, it is somewhat surprising that less than 20% of the NCTU offerings analyzed in the research included handset-based top-up applications, even though top-up frequency using handset applications can be up to 80% higher than other channels. This increased frequency also results in an ARPU increase of 23%.

The main imperatives stated for adopting a direct top-up approach were avoiding zero credit service interruptions, increasing top-up frequency and improving customer experience with anytime, anywhere top-up availability via handsets, the web and IVR. However, the research also indicated the ability of direct top-up to enhance CRM capabilities, enabling operators to identify high value customers and cross-sell while customizing and optimizing user experience. Indeed, over 90% of operators interviewed highlighted the need to strengthen the way that top-up integrates with their online services and other operator-controlled channels.

Chris Parsons continued, “By adopting a direct top-up approach, operators will improve their prepaid performance indicators by reducing costs, improving prepaid customer loyalty and increasing revenues. Operators are struggling to build-out direct top-up channels given the reduction in their IT budgets but those that address these challenges early will reap significant benefits in the prepaid market and create a strong platform from which to launch further mobile financial services.”

Source: cellular news

Adobe Flash may still be excluded from the iPhone, but the software company is determined to provide a unifying standard for the rest of the smartphone world, and will launch its key handset product by year-end.

The company currently offers Flash Lite for phones, but Apple and others have complained that this is insufficiently powerful for the high-end mobile web experience.

Adobe has since formed the Open Screen Project to support its Flash and AIR technologies as key systems that could bridge PCs and handsets, and is now set to release actual products.

CTO Kevin Lynch, in an interview with The Wall Street Journal, said that Adobe has made deals with chip designers and phonemakers and is offering incentives to developers to write programs the new version of the software.

Adobe will launch a trial version of Flash that works with most of the key smartphone OSs – including Palm WebOS, Google Android, Symbian and Windows Mobile – this year, though iPhone and BlackBerry remain off the roadmap for now.

“We need to have Apple’s agreement before we can do it,” Lynch said.

As promised for the past year, the new release will bring fully featured PC Flash to smartphones and Flash Lite will be phased out. Nokia is a key ally, and joined with Adobe in February to create a $10 million fund for developers who build mobile apps for Flash.

Source: telecomasia.net

The two epic cellular battles that have dominated headlines for months continue.

In the first instance, France Telecom says it won’t make a bigger offer to buy Osracom’s stake in ECMS, Egypt’s largest mobile operator, the Financial Times reports.

France Telecom and Orascom have been squabbling over the French operator’s attempts own ECMS (and its 21 million subscribers) outright since 2007 – they assumed joint ownership in 2001 – amid many claims and counter-claims of failure meet agreed or arbitrated conditions.

The two companies control ECMS via Mobinil, a company that owns 51% of the Egyptian mobile operator. France Telecom owns 71.25% of Mobinil and Orascom the rest. Orascom also owns 20% of ECMS directly.

In March, an arbitration court, sponsored by the International Chamber of Commerce, ruled that Orascom should sell its stake to France Telecom for €517 million ($725 million).

But, as the FT explains, the Egyptian securities regulator has in effect blocked the transaction by saying it take place in tandem with a tender offer to minority shareholders at ECMS, which is listed on the Cairo stock exchange.

Egypt’s Capital Market Authority has rejected two offers by France Telecom to the minority shareholders on the grounds they were too low. The most recent offer was worth €1.5 billion ($2.1 billion).

France Telecom has repeated its previous stance that it is ready for as long a legal battle as necessary to secure its rights (and control of ECMS) and continues to accuse the Egyptian authorities of overriding international law and consequently damaging future investments into Egypt.

In the second epic struggle, Russian bailiffs have agreed to hold off on the sale of Telenor’s shares in VimpleCom until the court in the West Siberian city of Tyumen has reached a decision, according to Dow Jones Newswires.

Reuters reports that the court has adjourned the case until 30 September.

Telenor yesterday said any deal with Alfa Group to resolve the dispute over jointly-owned mobile ventures in Russia and Ukraine must wait until the Russian court case brought by Farimex is solved.

Telenor maintains that Farimex is an off-the-shelf, British Virgin Islands company with less than a 1% stake in Alpha, that is being used by Alfa Group for unfounded gain. Alfa Group is owned by an oligarchy of Russian billionaires.

Telenor and Alfa have joint ownership of VimpelCom and also Kyivstar in Ukraine. Farimex is suing Telenor for delaying the progress of Kyivstar in Ukraine.

In this complex, protracted case, the bailiffs had frozen the shares as collateral against the $1.7 billion damages the court awarded against Telenor by the Siberian court in favor of Farimex.

Under the country’s law, the bailiffs could have sold the shares before Telenor had the chance to appeal.

Telenor has prevailed on the Russian Prime Minister, Dmitry Medvedev, to see that justice is done and the principles of international law upheld in the interests of encouraging investors into Russia.

Source: telecomasia.net

Research released today by mobile device management company Mformation highlights that the mobile phone is becoming increasingly central to consumer lifestyles. A significant amount of information is now stored on mobile devices. 94% of users surveyed store telephone numbers while 65% also store address and other contact information on their phones; 83% have digital photos, 51% have videos, 48% have calendar information and 40% have music downloads. With ever-increasing phone and network capabilities, this trend of using the phone to store valuable and sensitive data from every aspect of life is set to continue.

One consequence of using the phone as a method for creating and storing data and information is that people must now worry about this material if the phone is lost or stolen — 82% of people fear that if their phones were lost or stolen, someone would use the information stored on them for fraudulent means. 90% of those questioned are worried about the loss of their personal data if a mobile device were to go missing, with 72% admitting that the personal information stored on their devices would be difficult to replace. In addition, 40% of respondents even said that losing a mobile would be worse than losing their wallet.

“Mobile phones are becoming more and more essential to user lifestyles,” commented Matt Bancroft, Vice President, Mformation. “People can access the Internet and store significant amounts of valuable personal information and other content on their mobile devices. With new advances in mobile technology arriving every day, this trend will only increase the role of the mobile device in peoples’ lives by providing us with increasing freedom to store, manage, send, and receive information. Mobile operators need to make sure that users are confident that their devices are secure, the data on those devices is protected, and device content can be backed up and recovered if a phone is lost or stolen. Such a high level of dependency on mobile phones today means that operators need capabilities to help minimize risk and maximize trust,” continued Bancroft.

Because mobile phones are being used for such a wide range of activities, when a device is lost, it can prove to be devastating for the user. 91% of people questioned in the UK and US said they would be “devastated” if they lost their mobile phones. For this reason, it is unacceptable that three-quarters of the people interviewed said that it would take a day or more to get a new phone fully up and running with all their personal data after a loss or theft. In fact, 61% of people said that this should take 2 hours or less.

“Operators need to step up to the mark to make sure that their customers are getting the service they expect in terms of security, data recovery and phone setup,” said Bancroft. “As people continue to increase their reliance on mobile phones for everyday actions, operators have to make sure that they are ready to support this increased commitment by the user. More extensive use of the device is great, but the mobile operators need to underpin this activity by offering capabilities to protect and manage users’ data if things go wrong.”

The research was undertaken by independent research house Coleman Parkes, which asked 4,000 people in the UK and US about problems related to mobile usage.

Source: Total Telecom

This year could well be make or break for small-cap telecommunications companies, many of which are vulnerable as larger rivals step into their traditional areas of trade in an attempt to increase market share in uncertain economic times, analysts say.

Amid the gloom, however, some companies have shown a resilience to the downturn by growing market share through regional business and providing a series of niche services.

These companies have managed to create partnership arrangements with “tier one” blue-chip peers – big companies which typically own a physical infrastructure or network – carving out areas of resistance where other smaller companies may be struggling.

Tier one companies are now starting to move back into servicing the small and medium enterprise (SME) market through a process called “aggregated outsourcing.” This involves going to smaller telco companies and asking them to badge themselves as either BT Group PLC or Cable & Wireless, for example, to undertake SME work, with the tier one company taking a cut of the profits while outsourcing the work.

“BT won’t be the only blue chip eyeing the SME market, Cable & Wireless is also another contender after it cut its customer base from 30,000 to about 3,000 SMEs back in 2006,” said Andrew Darley, a telecommunications analyst at institutional broker and corporate adviser FinnCap.

One company which has shown resilience in the current market is AT Communications Group PLC. The company specializes in maintenance, and designing and installing Internet protocol technology which allows for communication of data across a packet-switched internetworks alongside standard telco operations.

“We’re seeing a reverse in the current trend, with more business from tier one companies,” said Chief Operating Officer Scott Kean.”If you look at Cable & Wireless, for instance, they’re clearly moving out of that [SME] space, and passing it on to suppliers like us.”

“C&W handed SME contracts over to us on condition that we don’t shift them onto another carrier. They still keep the revenue, albeit they reduce their margin,” he said.

“By doing this, tier one companies can shave off staff costs through structured redundancy,” Kean said.

“AT Comms has done well in a credit crunch, as people defer spending on hardware,” said Philip Carse, a telecommunications analyst at Teleq Consulting.

“By being lower down on the scale in terms of the sort of customer they are catering for, much of their business comes from the maintenance type, support contracts, areas which will show resilience as customers defer spending on new technology,” Carse said.

Kean said, however, smaller telco dealers and resellers will start to lose more ground to the tier one companies if they don’t secure partnership deals.

“Dealers and resellers are, and will continue to suffer for the moment. We’ll probably see more small companies looking to sell their business on or consolidate, getting out before their revenues are further reduced.”

Analysts also cautioned that, while AT Comms will benefit from aggregated outsourcing, it is still likely to suffer from recent cuts by blue chips in contractors and staff.”BT cut its contractor costs by 30% this year and you’d expect AT Comms to have a rather hard time because BT is their major client,” Darley said.

Analysts also said mid-size telecommunications firms could stand to benefit in the current market after a series of profit warnings in recent months from the likes of Alternative Networks PLC, Maintel Holdings PLC, and KCOM Group PLC, a Hull based telecommunications and internet provider, pushed such companies into significant restructuring.

“With these companies cutting so many costs, plotting how their positioning will look when the market recovers becomes difficult. But, if you look at KCOM, it’s a highly cash-generative business with a flexibility you may not get from a tier one,” said FinnCap’s Darley.

KCOM’s Chief Financial Officer Paul Simpson said that a company like KCOM will always have the advantage of bespoke products and services, something that larger peers can’t always offer “The larger you are, the more difficult it is to bespoke a product every time somebody rings you, but our size gives us a flexibility that you may not find with the larger players,” Simpson said.

It would be futile for a company like KCOM to buy up smaller networks to try and compete with tier one companies, he said.”We are a long way behind BT and C&W in terms of the size of our network; in this respect we’re much better off utilizing other people’s networks in combination with our own to drive our offering.”

The restructuring of the company’s operations has revolved around getting its Integration and Managed Services unit back to profitability. The company always had a very cash-generative business on one side of the fence and that “there would be no point in buying a smaller network unless it gave extra reach, and was underpinned by cost savings,” Simpson said.

Redstone PLC, a smaller communications services provider, is a unique investment case. The company operates very closely within the limit of its banking covenants and could stand to benefit from consolidation more than other smaller players.

The company migrated up the value chain to focus on much larger contracts to facilitate growth. While it has a strong sales pipeline, it faces cash flow problems as clients delay on contracts, according to FinnCap’s Darley.

Of the smaller telcos, Redstone is trapped in a financial straightjacket where it can’t generate sufficient cash to consider making significant acquisitions, Carse said.

This, therefore, pushes it toward one of two possible outcomes: either forge further partnerships with tier one players or look at the benefits of consolidation.

Carse said a merger or acquisition was still conceivable with Redstone, the shares of which have lost 85% of their value in the past 12 months, although it was more likely to be initiated by a tier one player who possessed “greater financial fire power.”

“The risks in the interim are significant, as are the rewards in the long run. However, there is no incentive to own the stock until those rewards are closer,” Darley said.

When asked Redstone didn’t wish to provide comment.

Analysts also cautioned about the dangers of “catching a falling knife.””If we’ve hit the bottom of the macro trend, then consolidation holds fewer perception risks,” said Darley, referring to the benefits of consolidation in an environment which would typically limit organic growth.

While the current market is still very uncertain, analysts are confident that there are benefits awaiting some smaller companies.”Apocalypse phase one, is passing,” said Darley.

“Direct company action on the balance sheets through initial and far-reaching cost-saving measures has resulted in more partnership deals and bespoke services, which has allowed them to reinforce their areas of business,” he said.

“There’s a proliferation of smaller telco companies which serve the SME market better than a tier one company can offer…investors should still be braced for volatility but understand that there are some highly cash-generative businesses on in this market trading at very much knocked-down prices,” Carse said.

Source: Total Telecom


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